Venture Capital Case Study: Harnessing the Power of Public Web Data

Use Cases

With millions of in-depth employee and company records collected from leading business-related online sites, Coresignal's public web datasets provide institutional investors with various uses and benefits. Our client identified three primary use cases.

Challenges

1. Discovering entities

Due to the competitive and saturated Bay Area investment market, the main challenge for VCs is identifying investment-ready companies and startups that have demonstrated early signs of growth. The Bay Area is one of the most lucrative investment markets both across the US and globally. According to Pitchbook's 2020 report, VCs invested over $60 billion in Bay area-headquartered companies during 2020. With such a competitive market, it can be challenging to find the right investment.

Before leveraging public web data, our client was faced with this difficulty, claiming that the firm was eventually overwhelmed with the number of new companies being founded both in the Bay Area and globally:

2. Quantifying company strength

After discovering investment-worthy ventures, VCs are taxed with accurately quantifying their strength. This can be difficult to achieve when relying on traditional data sources only as they most often do not give a complete and sufficiently timely picture.

3. Collecting data 

Collecting, managing, and storing large-scale datasets is another challenge VCs face when utilizing external data. In this particular case, scraping public web data in-house would be too resource-intensive and ultimately not cost-effective for our client. Therefore, sourcing raw, high-quality public web datasets from vendors such as Coresignal is the clear solution.

Solutions

With the help of Coresignal's external datasets and dedicated support, this VC developed data-driven deal sourcing, investment analysis, and decision enhancement solutions. 

1. Increased deal sourcing

Access to Coresignal's data helped our client discover and evaluate promising ventures. They were able to sift through the competitive investment market and extract signals from noise by leveraging primarily firmographic and employee data. 

2. Enhanced investment analysis

Our client combined multiple raw public web data sources to help them build a realistic company picture of their prospective and current investees. For example, by combining different public web datasets, they can analyze company structures, identify and assess key employees and scrutinize product strength.

3. Improved decision enhancement

Aside from filling in knowledge gaps, VCs use historical public web data for quantitative forecasting and data validation. Particularly, our client leveraged historical firmographic and employee data to help predict company success, validate business traction, and perform other analysis processes with time-series data.

Results

Even in one of the most competitive financial landscapes, this particular VC has found continued success by utilizing Coresignal's public web datasets. Prior to working with Coresignal, only 2% of this VC's investments were data-driven. Since then, they have grown the percentage of investments influenced by data to roughly 65%, signaling that data-driven investing has become the standard approach to investing today.  

Summary

By harnessing the power of public web data, our client was able to find success in one of the most competitive and saturated investment markets globally. Likewise, this firm is a leading example of how VCs are able to gain strategic insights, capture a 360° view of companies and professionals, and generate business opportunities with public web data.